Back in early 2019, after months of speculation linking Telefonica to a sale of its Central American operations, the Spanish telecom giant agreed to offload all five of its units in the region.
By the end of 2019, the Madrid-based group had unveiled a five-point turnaround strategy to overhaul its business.
One of the group’s most eye-catching aspects of the plan was Telefonica’s decision to spin off its Latin American businesses—excluding Brazil.
Then-CEO José María Álvarez-Pallete stated:
“The history of our company can’t be understood without our commitment to Latin America for 30 years, which has made Telefónica a better company. We have always shown a strong dedication to the region, even in its most difficult moments … Our operations in Latin America were the growth engine of the company until a few years ago. However, the particular conditions in these markets have had an impact on the business, reducing its contribution in recent years for different reasons and despite the enormous efforts of our local teams, which have always shown a strong commitment … With this operational spin-off, Telefónica begins a strategic review of its portfolio in Hispanoamérica with the double objective of modulating the exposure to the region, while creating the conditions to maximize its value via growth, consolidation and possible corporate transactions.”
In the wake of the COVID-19 pandemic, Telefonica’s immediate focus in Latin America was on sealing fiber-optic joint ventures in markets such as Brazil, Chile, Colombia, and Peru. Telefonica sought to pursue “strategic alliances” to reduce the digital divide—and reduce its exposure at the same time.
At the beginning of 2025, Álvarez-Pallete stepped aside to make way for Marc Murtra. With a number of divestments either confirmed or rumored in recent weeks, Telefonica’s original plan to reduce its exposure in the region has finally gathered pace.
Today, we examine the units on the chopping block and evaluate Telefonica’s rapidly shrinking portfolio.
Argentina
Unit: Telefonica Argentina (Movistar)
Mobile Subscriptions (December 2024): 16.15 million
Buyer: Telecom Argentina (Personal)
Sale Agreed: February 2025
Value: $1.245 billion
In February 2025, the Spanish group agreed to sell Telefonica Argentina (Movistar) to rival domestic operator Telecom Argentina (Personal) in a deal valued at $1.245 billion.
Both parties indicated that the deal was signed and closed on February 24. However, Telecom did not complete filing the required information with the National Communications Agency (Ente Nacional de Comunicaciones, ENACOM) and the National Commission for Defence of Competition (Comision Nacional de Defensa de la Competencia, CNDC) until the following month.
No sooner had the deal been announced than President Javier Milei’s government issued a statement confirming it would evaluate the tie-up, which would put 70% of the country’s telecom sector under the control of one group.
According to local news reports, Milei—who prides himself on cutting red tape and promoting free markets—has taken a personal interest in the deal because of his connections.
According to local news reports, Milei—who prides himself on cutting red tape and promoting free markets—has taken a personal interest in the deal because of his connections. His foreign minister, Gerardo Werthein, is a cousin to Dario Werthein, who leads Grupo Werthein—the company that was reportedly outbid for Telefonica’s assets.
Grupo Werthein, which owns DirecTV units across Latin America, has considered entering the local mobile sector via an MVNO agreement. The group seeks to complement its existing pay-TV/ISP business in Argentina.
Colombia
Unit: Colombia Telecomunicaciones (Movistar Colombia)
Mobile Subscriptions (December 2024): 20.595 million
Buyer: Millicom Spain, a subsidiary of Millicom International Cellular (MIC)
Sale Agreed: March 2025
Valuation: $400 million (67.5% stake); price could drop to $362 million after adjustments
Earlier this month, Telefonica reached an agreement to sell its 67.5% stake in Colombia Telecomunicaciones (Movistar Colombia) to Millicom International Cellular (MIC)—the parent company of Tigo Colombia—for $400 million.
The latter company will acquire the shareholding via its Millicom Spain subsidiary. The two parties note that the final value of the deal “will be subject to the usual price adjustments for this type of transaction” and could drop to $362 million.
The deal is subject to certain closing conditions, including the relevant regulatory approvals and specific agreements with Colombia’s Ministry of Finance and Public Credit and Empresas Publicas de Medellin (EPM).
In July 2024, Millicom said it intended to buy the government’s 32.5% stake in Movistar Colombia at the same purchase price per share offered to Telefonica. Additionally, Millicom intends to acquire EPM’s 50% interest in Tigo Colombia for a “comparable valuation multiple.”
When the deals are complete and Telefonica’s assets are merged with those of Tigo Colombia, the enlarged entity will boast a 43% market share, bringing it closer in line with dominant mobile player Claro.
Mexico
Unit: Telefonica Moviles Mexico (Movistar)
Mobile Subscriptions (December 2024): 21.500 million
Buyer: TBC
Sale Agreed: TBC
Valuation: $2 billion
In February 2025, Telefonica reportedly hired investment bank JPMorgan to sell its subsidiary Telefonica Moviles Mexico (Movistar). Sources close to the matter indicated that the group seeks to carry out the sale before its annual shareholders meeting, which is likely to be held in April or May.
Despite widespread sale speculation, no prospective buyers have been named to date.
TeleGeography notes that in September 2018, it was reported that Telefonica was considering the divestment of its Mexican division, with valuations ranging up to EUR1.9 billion ($2 billion). At that juncture, the unit piqued the interest of Cerberus Capital Management, but the investment firm was unwilling to match Telefonica’s valuation of the business.
Uruguay
Unit: Telefonica Moviles Uruguay (Movistar)
Mobile Subscriptions (December 2024): 1.38 million
Buyer: TBC
Sale Agreed: TBC
Valuation: $350 million–$400 million
In February 2025—amid a flurry of sales rumors—it was suggested that Telefonica was seeking a buyer for its Uruguayan business. Sources indicated that the future of the unit was closely linked to the fate of Telefonica’s Argentine subsidiary due to the close relationship between the two neighboring countries.
With the Argentina sale already confirmed, it seems that the days of the Uruguayan unit are numbered.
With the Argentina sale already confirmed, it seems that the days of the Uruguayan unit are numbered. Movistar Uruguay is said to be valued at between $350 million and $400 million—in line with an offer that Telefonica allegedly received more than three years ago from a consortium comprising Argentine ISP Super, businessman Edgardo Novick, and an unnamed U.S. fund.
Local news reports indicated that Argentina’s media conglomerate Grupo Clarin is the lead bidder for Movistar this time around. That said, Telecom Argentina—which already offers pay-TV services in Uruguay—could also be tempted to strike a deal.
Peru
Unit: Telefonica del Peru (Movistar)
Mobile Subscriptions (December 2024): 11.408 million
Buyer: TBC
Sale Agreed: TBC
Valuation: TBC
In February 2025, Telefonica del Peru (TdP, operating under the Movistar brand) announced that it would request an Ordinary Bankruptcy Procedure (Procedimiento Concursal Ordinario, PCO) before the National Institute for the Defence of Free Competition and the Protection of Intellectual Property (Instituto Nacional de Defensa de la Competencia y de la Proteccion de la Propiedad Intelectual, Indecopi) to restructure its financial obligations with a view to guaranteeing uninterrupted services to its customers.
To explain the company’s decision, TdP CEO Elena Maestre stated:
“After evaluating different alternatives to ensure the company’s financial stability, we came to the conclusion that voluntarily joining the PCO is the best way to protect the provision of telecommunications services to Peruvians.”
News reports indicated that the telco sought to negotiate a sale as its preferred course of action, but no suitable buyers could be found. Telefonica is keeping its options open, however, mandating Rothschild to oversee any takeover offers for its Peruvian subsidiary.
With the telco allegedly $1.358 billion in debt—of which roughly half is owed to the Peruvian treasury—any buyer would have to agree to take on TdP’s debt mountain before arranging a deal. As such, the idea of a debt-for-equity swap has been mooted, allowing the company’s creditors to assume control of the business.
Any Other Business?
Chile, Ecuador, and Venezuela have been conspicuous by their absence amid widespread reports of asset sales across Latin America.
Back in January 2021, reports emerged that Telefonica was in advanced talks to sell Telefonica Moviles Chile (Movistar) for an undisclosed fee, although any such deal failed to come to fruition. At that juncture, Liberty Latin America (LLA)—the parent company of Chilean ISP VTR—and rival full-service provider Claro Chile were listed as the main candidates for acquiring the telco, although Entel and WOM were not ruled out.
Meanwhile, in Ecuador, the Agency for Regulation & Control of Telecoms (ARCOTEL) temporarily extended Telefonica Ecuador (Otecel)’s mobile concession for a sixth time in February 2025 while the parties remain in negotiations over its renewal.
According to the ARCOTEL resolution issued on February 14, the latest extension will be valid “until the new enabling title is signed, or it is decided not to renew the concession contract; conditions that must be met within three months (i.e. before 15 May 2025), which if necessary will be extended by agreement of the parties under the same conditions as the present extension.” In 2019, the company was valued at EUR800 million ($881.8 million) amid takeover interest, but it remains to be seen whether it will pique anyone’s interest again.
Finally, in Venezuela—a market that holds limited appeal for international investors these days—Telefonica has given no indication that it is planning an exit. In January 2025, Telefonica Venezolana (Movistar) bid $37 million for a 2×20MHz block of 5G-suitable spectrum in the 2.5GHz band ahead of a planned 5G rollout. Indeed, the company claimed that the deployment activity will form part of a two-year $500 million investment program.
